Property mad Brits are the most profitable landlords in Europe

07 November 2007

Britain is leading the way in the property market in comparison to our European neighbours, according to the latest report by BM Solutions.

While UK landlords top the table in terms of buying property for redevelopment, Germany, Poland and Portugal have a thriving private rental sector which is being driven by the diverse economies and lifestyles across the EU.

Brit landlords also boast the biggest portfolios with an average of five properties, compared to 2.6 properties in Poland, 2.5 properties in Germany and 1.9 properties Portugal.

And it seems that UK landlords are the most passionate about property after the report showed that 17 per cent of UK landlords claim that this is their full time occupation compared to a mere 2 per cent of Portuguese landlords who say the same. However, German and Polish landlords better not give up their day jobs as none of the landlords questioned felt that this was their main source of income.

In terms of profit margins on their investments, Poland takes the top spot with 81% of landlords claiming to make a profit after costs, followed closely by the UK with 75% making an annual profit after costs. Portugal came in third place with 42 per cent, followed by German landlords who experience the lowest profit after costs with a worrying 30% of them stating that they make a loss annually after covering costs.

Steve Sandiford, Head of Specialist Lending Strategy at BM Solutions, explains: "BM Solutions' study is the first of its type on the European private rented sector. It is a major step forward for the market. This review will underpin the development of Buy-to-Let with solid numbers and strong market insight. Across Europe the norm is to buy well into your thirties. The UK is moving to a more continental European mindset with home ownership no longer the be all and end all.”

However, despite the glowing figures, the same can’t be said for UK landlords with property abroad. MRI Overseas Property has released its own report which reveals that nearly 30 per cent of international property owners only visit their investment twice a year – which could mean they face losing valuable income of up to £800 if they neglect to use the renting opportunities across the year wisely.

As the property market reaches its peak in the UK, an increasing amount of Brits are looking abroad to get a solid return on their investment. Holiday homes can provide the perfect solution due to a constant demand for accommodation by British holidaymakers. And with the possibility of further interest rate rises and the current economic climate here in the UK, seasoned buy-to-let experts are beginning to look further afield. Nineteen per cent of British landlords have said if interest rates reach 6 per cent, they will consider buying property overseas for a better return on their investment.